What’s Next for Nike?

From a pioneer in distance running gear to a target in the fight for corporate responsibility, Nike has run the gauntlet and maintained its status as one of the most recognized brands in the world. Where does Nike go from here?

Nike began in the 1960s as the modest Blue Ribbon Sports, cofounded by famed running coach Bill Bowerman and Phil Knight, who is still the company’s chairman. Bowerman, who coached Steve Prefontaine and dozens of others to numerous collegiate victories at the University of Oregon, is in many ways the essence of the company. According to the National Distance Running Hall of Fame, he is also “credited with turning the college town of Eugene, Oregon, into the running capital of the world.” Bowerman created the “first lightweight outsole shoe from some latex, leather, glue and his wife’s waffle iron,” and Nike was born.

Since then, Nike has established itself through innovative design, technology and an enormous amount of advertising as a sporting goods leader. For better and for worse—labor activists track Nike’s progress in corporate responsibility and never hesitate to broadcast it—the brand is ubiquitous around the globe. Its stores are palatial, immaculate tributes to the world’s most popular sports (golf, tennis, soccer, running) and boast cutting-edge technology and design. Nike’s offerings are neither excessively fussy nor overly plain. It has routinely won opportunities to outfit national teams and highly prominent athletes like Tiger Woods, Mia Hamm and Roger Federer. As a result, its currency continues to grow. As evidence, its home on the Web, Nike.com, has no less than twenty Web site offshoots for numerous sports, sectors and demographics.

While sponsorship of famous athletes also translates into advertising, the company has significantly altered its marketing operandi in the past few years, shifting the focus from star power to people power. The advent of the Web has shown that free services, of which Nike has several, are valuable to customers and are now a compulsory part of a company’s online offerings. For example, NikeRunning.com offers a place for runners to meticulously log their workouts and data from the Nike+ device, but Nike+ is not required to enjoy the service. Nike told The New York Times in 2007 that “much of the company’s future advertising spending will take the form of services for consumers, like workout advice, online communities and local sports competitions.”

Nike has dominated for several decades, but its game face looks distinctly more confident today than it did in the 1990s, when the company was at the center of a number of investigations and lawsuits concerning its Asian factories. Audits commissioned by the company and independent labor activists’ research found that workers were being subjected to low wages, unsafe conditions and sexual harassment. There was also some indication that the company was hiring underage workers. Jeff Ballinger, who works for the labor nonprofit Press for Change, was instrumental in bringing Nike’s activities to light. He created a chronology of Nike’s troubled labor history from 1988 through 2000, available at Washington University’s Center for Communication & Civic Engagement.

Nike renewed its commitment to ethical behavior again in the beginning of this decade after a lawsuit filed in California in 1998 accused the company of “greenwashing,” falsely advertising the conditions of its Asian factories, and essentially crossing the line from “free speech” to “commercial speech.” The case reached California’s Supreme Court in 2002, which ruled against Nike. As reported on CommonDreams.org, the justices wrote that when a company makes “actual representations about its own products or its operations, it must speak truthfully.”

Since that stunning decision, Nike has remained on top and continued to establish itself as a pioneer in technology. It focuses on sweatproof materials; light, shock-absorbent footwear and accessories like the Nike+ line, which works with Apple’s iPod to track distance and pace. Recently, Nike, sponsor of Team USA’s gear and apparel at the Beijing Olympics, unveiled its “most innovative, lightest” footwear and apparel, using so-called Nike Swift materials that help reduce drag and make sprinters faster, much like Speedo’s LAZR Racer, a full-body swimsuit that debuted this winter. According to the Nike Corporate Web Site, the company plans to release several of the Swift products to the general public.

The latest corporate hurdle is diminishing the carbon footprint, but Nike is moving ahead on that front, too, by introducing the company’s “Considered” program. The program aims to “reduce greenhouse gases and trim factory inefficiency by making cleaner, more sustainable designs,” reported The Wall Street Journal earlier this year. Considered has developed new products such as the Air Jordan XX3, a revamped version of the Nike Air Jordan, the company’s best-known shoe. “In anticipation” of some of the flak it received in the ’90s, Nike is also working for sustainability in other areas. For example, a factory in Belgium employs energy from a wind farm. Hannah Jones, who oversees Considered, hopes to move the company to “design the future ... as opposed to retrofit the past.”